Xin Lang Cai Jing·2026-01-04 09:54Core Viewpoint - The insurance sector in A-shares has emerged as the standout performer of 2025, with the insurance index surging by 31.31%, significantly outperforming the Shanghai Composite Index's 18.41% increase and other financial sectors [1][11]. Performance Summary - All five major listed insurance companies experienced stock price increases, breaking free from previous sluggishness. New China Life Insurance led with a 46.03% rise, followed by Ping An Insurance with over 35%, and both China Pacific Insurance and China People's Insurance achieving over 20% gains. Even China Life Insurance, which performed relatively weaker, recorded a 10.39% return [1][11]. - The insurance sector's performance has improved significantly over the past two years, transitioning from being overlooked to becoming a market favorite. The sector faced unprecedented challenges from 2020 to 2023, including declining investment returns due to low interest rates and weak consumer demand for insurance products. However, a turnaround began in 2024, with major companies seeing stock price increases of over 30% [3][13]. Market Dynamics - In December 2025, the insurance sector experienced a notable rally, with a monthly increase of 14.77%, surpassing overall market performance. Key companies reached new highs, indicating a peak in market interest for the sector [3][13]. - The surge in insurance stocks is attributed to multiple favorable factors, including supportive regulatory policies introduced in the second half of 2025, which encouraged investment in equities and promoted the development of health and annuity insurance products [5][15]. Financial Performance - The overall stock market's positive trend in 2025 led to a significant increase in insurance companies' investment income, with net profits exceeding 420 billion yuan, a year-on-year increase of 33% [6][16]. - Insurance companies are actively transforming their product offerings, focusing on dividend insurance products to reduce liability costs while meeting consumer savings needs in a low-interest-rate environment [6][16]. Future Outlook - Industry experts are optimistic about the insurance sector's prospects for 2026, anticipating a dual recovery in both asset and liability sides. Increased consumer demand for savings and protection insurance is expected as the economy recovers, alongside improved profitability from new business lines [7][18]. - The growing proportion of equity assets held by insurance companies is likely to enhance profit margins, especially if the equity market continues to perform well in 2026, potentially driving stock prices and valuations higher [7][18].